Group Five Building Ltd v Government of the Republic of South Africa (Minister of Public Works and Land Affairs)

• Jurisdiction: South Africa
• Judge: Corbett CJ, Hefer JA, vivier JA, Eksteen JA and Kriegler AJA
• Judgment Date: 18 February 1993
• Citation: 1993 (2) SA 593 (A)
• Hearing Date: 10 November 1992
• Court: Appellate Division

Corbett, CJ.:

The appellant company carries on business as a building and engineering contractor. On about 5 May 1983 appellant entered into a J contract with the respondent, the South African Government (represented

Corbett CJ

A by the Director-General: Community Development), in terms whereof appellant undertook to erect certain buildings at Walldoorn, Pretoria ('the building contract'). In July 1988 appellant instituted action in the Transvaal Provincial Division claiming payment of the sum of R632 578,95, B interest and costs of suit. This claim was alleged to arise from the building contract. The respondent took exception to appellant's particulars of claim on the grounds that it disclosed no cause of action or, alternatively, was vague and embarrassing. At first instance the exception was upheld by Streicher J, who ordered that 'plaintiff's action C is dismissed with costs'. An appeal to the Full Court of the Transvaal was dismissed with costs (Leveson J, Joffe J and Myburgh AJ concurring). The judgment of the Full Court has been reported: see Group Five Building Ltd v Government of the Republic of South Africa (Minister of Public Works and Land Affairs) 1991 (3) SA 787 (T). Subsequently special leave to appeal to this Court was granted.

In appellant's particulars of claim the various contract documents are D referred to and the relevant ones, or relevant portions thereof, are annexed. They consist of a tender, an acceptance of tender, a bills of quantities contract, certain conditions of contract and clauses 49 and 50 of a schedule of quantities. The particulars of claim (paras 8 and 9) specifically quote clause 17(i), (ii) and (iii) and clause 18(B)(ii)(a) and (b) of the conditions of contract. They read as follows: E

'17 (i)

The contractor shall be allowed from the time the site is handed over to him 14 days for the delivery and arrangement of his plant and material, and at the expiration of the said 14 days the said works shall be commenced and proceeded with, with all due F diligence to the satisfaction of the engineer, and the whole works shall be completed within nine months from the date of the letter of acceptance of tender. The site shall be handed over to the contractor within 14 days after he has complied with the conditions of tender relating to security and the submission of priced schedules of quantities if applicable.

(ii)

If the works shall be delayed by cessation of work by any workmen, inclement weather, or by any omissions, additions, substitutions G or variations of the works, or of any items of work, labour or material, or by any other causes beyond the contractor's control then the contractor shall have the right within 21 days of any such cause of delay arising, to apply in writing to the Director-General: Community Development through the engineer to extend the date of completion mentioned in ss (i) of this clause, stating the cause of delay and period of extension applied for.

(iii)

H The Director-General: Community Development upon receipt of such written application together with the report thereon of the engineer may by order in writing extend such date of completion by a period to be determined by him, or may refuse to extend such date of completion, or may postpone giving a decision upon such application until completion of the contract period set out in ss I (i) of this clause; the date of completion will be extended only to the extent approved by the Director-General: Community Development, and in the assessment of the liquidated damages provided for in this contract, no allowance shall be made to the contractor for any delay other than for the period of extension (if any) approved of by the Director-General: Community Development.

. . .

18(B)(ii)(a) If the contractor elects to furnish a cash deposit of 10% of J the total

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A amount of the contract, or any approved guarantee for this sum, then clause 18 as above shall apply mutatis mutandis and the Director-General: Community Development shall have the right to adopt and exercise any one or more courses as provided in the foregoing ss (A); or to allow the contractor to proceed with the works and to deduct as and for liquidated and agreed damages a sum of R620 per day, for B each day on which the completion of the works may be in arrear under clause 17 of these conditions. Such sum may be deducted from any sum due or to become due under this or any other contract heretofore or hereafter existing between the contractor and the Government, or may be recovered by action in any competent court of law.

(b) C The Director-General: Community Development is hereby authorised to deduct the said sum, and the contractor hereby agrees and binds himself not in any way to dispute the right so to deduct or the amount deducted.'

Paragraph 10.1 of the particulars of claim proceeds to aver that on a proper interpretation of clauses 17(i), (ii) and (iii) and 18B(ii), inter alia:

D 'The causes of delay for which the Director-General: Community Development was entitled and obliged to grant extension of time extending the completion date of the works, did not include any act and/or default and/or breach of contract on the part of the defendant or of the engineer, or any act or default of any person for whose act or E default the defendant or the engineer are responsible, except those acts of the engineer referred to in clause 17(ii), namely "any omissions, additions, substitutions, variations of the works".'

And in para 10.2 it is stated:

'The said causes of delay not so included are hereinafter referred to F as the "wrongful causes of delay".'

Paragraphs 11 and 12 of the particulars of claim read as follows:

'11.

It was an express, alternatively tacit, further alternatively implied term of the contract between the parties that:

11.1

all variations and instructions would be given timeously in relation to the actual progress of the works, alternatively at G an opportune time, further alternatively in such a way and at such a time so as not to disrupt the general progress or momentum or method or sequence of construction of the works by the plaintiff;

11.2

in the event of late or inopportune instructions or variations, plaintiff would be entitled to extension of time H and/or additional remuneration and/or damages caused by such variations or instructions.

12.

It was in the contemplation of the parties that if any delays or failure timeously to issue instructions and/or variations should occur or if plaintiff's programme of work should be altered or I additional work be ordered to be done, then the execution of the works, the plaintiff's planning thereof and the allocation by the plaintiff of resources including labour, plant, material would be disrupted or rendered inefficient with consequent additional costs, including on-site and off-site overhead and administrative costs.'

J In paras 14 and 15 it is alleged that the completion of the works was

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A delayed by various wrongful causes of delay 'which constituted breaches of contract on the defendant's part and in particular breaches of the terms set out in para 11 above' (my emphasis). Five such wrongful causes of delay are then set forth. The first of these relates to an alleged delay before the appellant took over the building site. The other four are all B instances of variations of the contract which the appellant was instructed in writing to carry out, each of which is alleged to have resulted in a delay of a certain number of working days.

Paragraph 16.1 sums it up by alleging that

'by reason of the...